P&G Japan: The Sk-Ii Globaliztion Project

GROUPS#1 -WRITE UP

P&G JAPAN: THE SK-II GLOBALIZTION PROJECT

1. Problem Identification:

* Should it take its SK-II brand global?

o Which Markets were the most important to enter?

 Important differences between Japanese Chinese and European market.

 How this plan should be implemented?

 This would be the first time ever that they had taken a Japanese brand worldwide

* Organizational Restructuring.

o This reorganization was a long term plan (Started before 1999 and was planned to be finished in 2005)

o Everyone was just learning their new roles in this management structure.

o Essentially, they had been growing internationally for three-quarters of a century.

2. Analysis:

* P&G struggled greatly in Japan: Failed to see the very demanding needs of the consumers and had underestimated their competitor's ability to innovate. They had also not adapted to complex distribution system. Decided that Japan needed a very heavy R&D department that could focus on meeting these demands. While this solution greatly improved their performance, with the economy bubble burst, P&G began having problems again.

* They implemented a Leadership Innovation Team to identify and support major innovation projects companywide.

* Beginning of 2005 reorganization

o Found that many employees were spending their time on "non-value added" activities and they wanted to decrease this.

o They shifted from their 4 regional units to seven global business units - these units were completely in charge of the processes and increase efficiency by standardizing manufacturing processes and many other responsibilities.

o Out of these restructuring and pouring into the Japanese market - they discovered the SK-II. Very popular in Japan - but those outside that market knew little of it.

o Much innovation came out of Japan because of the extremely demanding customers and unsatisfied demand.

* On to the SK-II: global brand or not?

o Which markets should they enter?.

First they must consider the Asian market because it is related to the Japanese market (they follow Japanese fashion trends), but should be careful considering their approach in China. Secondly they should start targeting the European market entering the UK that is not that inundated with similar high end products as other European countries.

o They had experience with mass products and very little with of high

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